TIAA-CREF Buys Boston’s 33 Arch St. from AREA Capital
- Sep 14, 2011
September 14, 2011
By Nicholas Ziegler, News Editor
“While Boston’s CBD still has yet to recover all the jobs lost in this past recession, an impressive numbers of tenants continued to transact this past quarter.” That’s how a recent Jones Lang LaSalle report characterizes Boston’s Financial District. There has been and will be plenty of action, and the recent sale of 33 Arch St. keeps the trend going. The 33-story, Class A office tower was just moved off the books of AREA Property Partners its partner, Ivanhoé Cambridge, and into the rolls of TIAA-CREF, an institutional financial-services firm.
“33 Arch St. is an outstanding asset,” Philip J. McAndrews, head of global real estate transactions and joint ventures for TIAA-CREF, said. “Boston is an enduring market, and 33 Arch St. enhances our Boston office portfolio and highlights our commitment to actively engage in targeted, gateway cities.”
The building experienced a surge in leasing activity in the last year, with 85,000 square feet of new leases to increase the occupancy rate from 80 percent to 90 percent since 2010. In addition, 33 Arch St. holds LEED Gold certification.
“There is a dearth of high quality trophy assets in the Boston market, so demand for 33 Arch Street was especially strong by tenants and investors alike,” Steven Wolf, head of portfolio management and U.S. value enhancement funds with AREA, said. “We continue to own assets in Boston and look favorably on doing other transactions in this city that will allow us an opportunity to create value through comprehensive capital improvement and hands-on asset management as we did at 33 Arch St.”
While the purchase price was not disclosed, Class A asking rents in the Financial District reached $49.11 per square foot gross for the second quarter of 2011, according to JLL. And, just last month, two 14-story medical-office buildings on the Tufts University campus downtown were purchased by ProMed Properties for $112 million.